Conventional Loans: The Gold Standard in Financing.

Looking for the lowest long-term cost? Conventional loans offer the most flexibility

for those with stable income and solid credit.

Minimum Requirements to Qualify

Standard guidelines for a NextGen Conventional Loan.

 Credit Score

No universal minimum credit score is required, though higher scores qualify for better rates and terms.

Down Payment

As little as 3% for first-time buyers. 5% to 20% for repeat buyers or specialized programs.

DTI Ratio

Normally, debt-to-income ratio should be 43% or lower, though exceptions exist up to 50%.

Property Type

Primary residences, second homes, and investment properties (1-4 units) are all eligible.

Conventional vs. FHA

Which path is right for your financial profile?

The Conventional Path

Best for borrowers with higher credit scores and lower debt.

  • PMI can be removed once you reach 20% equity (lowering your monthly payment automatically).

  • Lower overall lifetime costs than FHA for strong credit profiles.

  • Used for second homes or investment properties.

The FHA Alternative 

Best for borrowers with lower credit scores or smaller down payments.

  • Mortgage insurance (MIP) usually stays for the life of the loan. 

  • More lenient credit score requirements (500+). 

  • Limited to primary residences only.

What you'll need to apply

Gather these documents to speed up your

pre-approval process.

Income & Employment

  • Last 2 years of W-2 forms

  • Most recent 30 days of paystubs

  • Last 2 years of Federal Tax Returns

Assets & Identity

  • 60 days of Bank Statements

  • Proof of Down Payment (Savings)

  • Driver's License or Passport

Mortgage Payment Calculator

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Frequently Asked Question

Gather these documents to speed up your
pre-approval process.

What is the minimum credit score for a conventional loan?

There is no standard minimum credit score set by Fannie Mae or Freddie Mac. Approval is based on the full loan profile, and some borrowers may qualify without a traditional credit score.

How much down payment is required for a conventional loan?

Conventional loans can require as little as 3% down for qualified first-time buyers. Repeat buyers usually put down 5% to 20%, depending on the loan structure and financial profile.

Does a conventional loan require private mortgage insurance (PMI)?

Yes, if you put down less than 20%, PMI is required. The good news is that PMI can be removed once you reach 20% equity in your home, lowering your monthly payment.

Can I use a conventional loan for an investment property?

Yes. Conventional loans can be used for primary residences, second homes, and investment properties (1–4 units). FHA loans, by contrast, are limited to primary residences only.

How does a conventional loan compare to an FHA loan?

Conventional loans are typically better for borrowers with strong credit and lower debt. They often have lower lifetime costs and allow PMI removal. FHA loans may be more suitable for borrowers with lower credit scores or smaller down payments.

Start your Conventional
Pre-Approval.

NextGen Mortgage can issue conventional loan pre-approvals in as little as 15 minutes.

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